The video rental company will now offer customers a plan that includes the ability to view movies through its streaming service for $7.99 per month. It was quick to point out that its cheapest plan includes no DVD rentals.

In addition, Netflix has increased its streaming-plus-DVD-by-mail plans by $1 to $8 per month, depending on the option. Netflix's previous $8.99 plan, which offered streaming and one DVD out at a time is now $9.99. The company's two-DVD plan, plus streaming, is now $14.99, up from its previous $13.99 price tag.

Netflix's three-DVD through eight-DVD plans have gone up based on the number of discs available at one time. So, its six DVD plan went up by $6, while its eight DVD plan is now higher by $8.

The company said that it decided to change its plans because "most members want us to deliver unlimited TV episodes and movies two ways: streaming instantly over the Internet plus DVDs by mail." By increasing the price of that dual option, Netflix says that it can "continue to offer the popular plan choice of unlimited TV episodes and movies streaming instantly along with unlimited DVDs."

By creating a new streaming-only option offered for $7.99 per month, Netflix has matched two other offers in one fell swoop: its Canadian streaming service and Hulu Plus. But it's the latter that it likely cares most about.

Last week, Hulu dropped the price of its service from its old rate of $9.99 to $7.99, making it $1 cheaper than Netflix's then-cheapest streaming option. With its new plan, Netflix has put itself on an even playing field with Hulu on the many devices that both services are running on, including the PlayStation 3 and Roku boxes.

It seems the streaming war between Hulu and Netflix has officially begun.